Novartis pays up to $1 billion for potential eczema drug

Swiss pharma Novartis is to pay up to $1 billion to Galapagos and MorphoSys for exclusive rights to a skin drug, which will further strengthen Novartis’s leadership position in the immunology field.

Belgo-Dutch biotech Galapagos and Germany's MorphoSys have signed a global license agreement with Novartis for MOR106 to treat atopic dermatitis - also known as eczema.

The deal includes a payment of $111 million upfront, with potential milestone payments of approximately $1 billion on top of royalties. The payments will be distributed equally between the two biotechs.

Novartis will also cover all future research, development, manufacturing and marketing costs.

The agreement is subject to clearance by the US antitrust authorities and will become effective as soon as this condition has been met.

Simon Moroney, chief executive officer of MorphoSys, said: "This collaboration with Novartis will enable us to accelerate and broaden the development of MOR106 beyond our current focus on atopic dermatitis and to exploit the potential of MOR106 to the maximum.”

“Data from preclinical models and expression analyses suggest that the target of MOR106 might be involved in other diseases, which justifies expanding the development program. We are also very pleased that we can further strengthen our engagement in atopic dermatitis by starting additional trials together with Galapagos, which will be fully reimbursed by Novartis."

Onno van de Stolpe, CEO of Galapagos, added: "It is very gratifying to announce this collaboration with Novartis, an immunology and dermatology powerhouse, to broadly expand the development and pave the path to potential commercialisation of MOR106.”

A phase 1 study of MOR106 in healthy volunteers as well as in atopic dermatitis patients concluded in 2017. A phase 2 clinical trial in moderate-to-severe atopic dermatitis patients was started in May this year and is still ongoing.

By signing this deal Novartis is expanding its footprint in immunology and dermatology field. In December 2016, the company purchased British biotech Ziarco adding a first-in-class oral therapy for eczema to their dermatology portfolio.